Beyond Sales Reporting: Broadridge Tool Maps Out Market Share

At a users conference in Pittsburgh at the end of September, Broadridge Financial Solutions introduced "a tool for strategic thinkers."

Where other online tools for tracking fund sales let managers zero in on performance by representative or region (See "Watching (and Measuring) Sales Performance," page 12), Broadridge, working in conjunction with its newly acquired Access Data unit, is letting chief executives and chief financial officers as well as top sales, marketing and product development managers see how their products are faring against the competition, in the marketplace, day by day.

"It is not sales reporting," said Frank Polefrone, senior vice president at Access Data. "This is more industry information for the C-level people at a firm to decide just how they want to manage their business and figure out how they're doing."

The tool is called Market Intelligence, and the mutual fund version was unveiled Sept. 23 to roughly 50 customers at the Pittsburgh user conference. That followed the introduction of a Market Intelligence product for exchange-traded funds, released in July.

Both are part of Access Data's SalesVision suite of online services used to track distribution of funds and strategically manage the marketing and sales of individual funds and families of funds.

The intelligence comes from rolling up reporting on transactions and asset positions from the majority of distributors in an industry, combining data available from Broadridge, with technology tools from Access Data.

The result is an ability for top sales, marketing and product managers to see more than just how many shares are moving through a given distribution channel or distributor, but what those distributors positions are. And, most critically, how those positions compare to the amount and value of shares held throughout the industry.

In effect, the result shows mutual fund firms its fund positions versus an aggregated industry position broken out by Morningstar categories. The market share positions are provided at a firm and office location and updated on a monthly basis.

Data, for instance, is constantly updated on the positions held by wirehouses, independent brokers and registered investment advisers. If, for instance, you want to see how a particular firm is doing, a dashboard or a report can tell you the number of shares of a particular type of fund, say a large-cap blend, is held by that firm, what the total position amounts to in dollars, how many shares of that kind of fund are held by all firms and what the overall holdings are, industry wide. The firm's holdings are divided into the industry's holdings, on screen, automatically, and additional columns display the market shares.

"This is a tool really for the heads of sales and heads of marketing and heads of product development to look at industry information, to help them deploy resources properly, spend marketing dollars more wisely, and decide whether there is any gaps in their products that might want to think about" filling in, Polefrone said.

"It's a tool for strategic thinkers about where the business is going and how they should be reacting to those changes."

Thinking strategically and using the tool accordingsly, C-level managers can see not just where their products are selling, but where similar products are selling as well. They can figure out if other firms are moving a lot of product through channels that one's own firm has not entered (yet). And it can see where exactly its marketing efforts are working and where they are not.

This can be done by a simple traffic-light mapping system. Managers can set a threshold for what they think is a meaningful level of sales above the norm, say 3%. And below the norm, also 3%. Then, the data from all distributors, including one's own, are compared at those thresholds and a 50-state map is produced that shows where your distributors are doing well (green states), where they are not (red states) and where they are just holding their own (yellow states).

The approach can be fairly granular. You can get a profile for a large distributor, by Morningstar category of fund, to determine the flows into each category by location. And see just how that compares with the rest of the industry, at any time.

"This is the essence of it. We've had technology in place that allowed us to take individual transactional information, purchases and sales, and report it to clients and slice and dice it," Polefrone said. "Now this is asset positions for the majority of distributors in the industry for the majority of flows of the assets-over 90% in all cases-broken by all these different categories and organized by distribution channel. There's nobody else in the industry positioned to do that."

If you want to see the data, you have to participate in the program. Industry information is aggregated and rolled up. You can see your own positions against the industry as a whole, but not against individual competing firms.

Still, it's a big step forward and an approach that could find application in any competitive industry: Immediate comparisons, immediate market share results, with actual transaction and position data the foundation.

Used adroitly, C-level product, sales and marketing executives will be able to figure out where to concentrate their efforts, what firms and what offices are most strategic for certain kinds of fund sales, where work needs to be done to build business, what new products might be needed next and other such major decisions affecting long-term direction-and results. You get to ask, for instance, Polefrone noted, not just: "Is this category hot?"; but, "Is everybody moving or am I just moving?"

The Market Intelligence products were in development almost from the moment that Access Data was acquired by Broadridge, Polefrone said. They marry pre-existing Access Data technology with information available through Broadridge, which is then cross referenced against Morningstar mutual fund and ETF information.